invention-assignment-agreement

# Confidentiality and Invention Assignment Agreement (CIAA/PIIA)

Drafts an execution-ready CIAA securing company IP and trade secrets while complying with state invention assignment statutes and federal DTSA requirements.

## Prerequisites

1. **Parties** — company legal name, state of formation, address; employee/contractor name, address, title
2. **Governing jurisdiction** — determines invention carve-outs, non-compete enforceability, required exhibits
3. **Relationship type** — employee vs. independent contractor (affects WMFH eligibility)
4. **Prior inventions** — pre-employment IP to exclude (Exhibit A)
5. **Restrictive covenants** — non-solicitation of employees/customers, non-compete (if any)
6. **Existing agreements** — prior CIAAs, equity awards, offer letters to reconcile

## Core Workflow

### 1. Parties & Recitals

- Full entity name, jurisdiction, principal address
- Employee name, address, role
- Recitals: access to CI, IP creation during employment, legitimate business interest

### 2. Confidential Information

**Definition categories:**

| Category | Examples |
|---|---|
| Technical | Source code, algorithms, formulas, processes, designs, R&D data |
| Business | Strategic plans, pricing, financials, customer/supplier lists |
| Personnel | Compensation, performance reviews, org structure |
| Third-party | Information received under NDA from customers, partners, suppliers |

**Standard exceptions (all four required):**
1. Publicly available through no breach by employee
2. Rightfully in employee's possession pre-disclosure (written records required)
3. Received from third party without confidentiality obligation
4. Independently developed without use of company CI (written records required)

**Obligations:** strict confidence; company-purposes only; reasonable care standard; return all materials + written certification on termination (including personal devices/cloud); no copying/removal beyond job requirements.

**Duration:** trade secrets — indefinite (never cap with fixed term); other CI — [3–5 years] post-termination.

**DTSA immunity notice (mandatory post-May 11, 2016):**

> An individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (i) is made in confidence to a federal, state, or local government official or to an attorney solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document filed in a lawsuit if such filing is made under seal.

Omitting this bars exemplary damages and attorney's fees under 18 U.S.C. § 1833(b).

### 3. Invention Assignment

**Scope:** ideas, discoveries, improvements, works of authorship, software, algorithms, processes, know-how, data — whether or not patentable, made alone or jointly during employment.

**Assignment triggers (any one):**
1. Relates to company's current or anticipated business/R&D
2. Uses company equipment, facilities, time, materials, or trade secrets
3. Results from assigned tasks

**Assignment language:** use present-tense "hereby assigns" for immediate vesting. Include fallback "agrees to assign" for jurisdictions not recognizing present assignment of future rights.

**State invention carve-outs:**

| State | Statute | Notes |
|---|---|---|
| California | Labor Code § 2870–2872 | Must attach full § 2870 as exhibit (required by § 2872) [VERIFY] |
| Delaware | 19 Del. C. § 805 | Similar to CA scope [VERIFY] |
| Illinois | 765 ILCS 1060/2 | Similar to CA scope [VERIFY] |
| Kansas | K.S.A. § 44-130 | Similar to CA scope [VERIFY] |
| Minnesota | Minn. Stat. § 181.78 | Similar to CA scope [VERIFY] |
| North Carolina | N.C. Gen. Stat. § 66-57.1 | Similar to CA scope [VERIFY] |
| Utah | Utah Code § 34-39-3 | Similar to CA scope [VERIFY] |
| Washington | RCW § 49.44.140 | Similar to CA scope [VERIFY] |

**Prior inventions (Exhibit A):** employee lists excluded pre-employment IP or represents none exists. Use checkbox: ☐ No prior inventions / ☐ See attached list.

**Disclosure:** employee promptly discloses all inventions in writing; company confirms ownership in writing.

**Cooperation / POA:** employee cooperates post-termination at company expense; irrevocable POA coupled with interest, surviving death/incapacity, limited to IP prosecution for assigned inventions.

**Copyright / WMFH:** works within scope of employment are WMFH under 17 U.S.C. § 101; include backup assignment for non-qualifying works. Contractors: WMFH limited to enumerated categories — always include backup assignment.

**Moral rights:** employee waives to extent permitted by law. Not waivable in certain non-US jurisdictions.

### 4. Restrictive Covenants

**Non-solicitation of employees** (generally enforceable):
- Prohibit direct/indirect solicitation or recruitment
- Limit to employees with whom departing employee worked or about whom they obtained CI
- Duration: 12 months post-termination

**Non-solicitation of customers** (generally enforceable):
- Competitive-purpose solicitation only; "customers" = material contact during final [12–24] months
- Duration: 12–24 months post-termination

**Non-compete — check jurisdiction before including:**

| Jurisdiction | Status |
|---|---|
| California | Void (Bus. & Prof. Code § 16600; 2023 amendments reinforce) [VERIFY] |
| North Dakota | Generally prohibited |
| Oklahoma | Generally prohibited |
| Minnesota | Prohibited for agreements on/after Jan. 1, 2023 [VERIFY] |
| All others | Permissible if reasonable in scope, duration, geography |

If including: 6–12 months; geographic scope = actual operating territory; activity scope = actual products/services. Include blue-pencil/reformation clause. Check if jurisdiction requires independent consideration for post-hire covenants.

### 5. General Provisions

| Provision | Key points |
|---|---|
| Governing law | Specify state; some states void choice-of-law stripping home-state protections |
| Forum selection | State/federal courts in [county/state] or AAA Employment Arbitration |
| Entire agreement | Supersedes prior CIAAs; carve out offer letter, equity, handbook |
| Severability | Reform invalid provisions to minimum; sever if court declines |
| Amendment | Written, signed by both parties |
| Assignment | Company assigns to successors; employee requires consent |
| Tolling | Covenant periods tolled during breach (verify enforceability) |
| Survival | CI, IP assignment, covenants, cooperation survive termination |
| Counterparts | Electronic signatures acceptable |

### 6. Acknowledgments & Execution

Employee acknowledges:
- [ ] Read and understands the agreement
- [ ] Opportunity to consult independent counsel
- [ ] Voluntarily executed, without duress
- [ ] Restrictions are reasonable
- [ ] Received DTSA immunity notice
- [ ] (CA / applicable states) Received copy of Labor Code § 2870

Signature blocks: employee (signature, name, date) + company officer (signature, name, title, date).

### 7. Exhibits

- **Exhibit A** — Prior Inventions Disclosure
- **Exhibit B** — Cal. Labor Code § 2870 full text (CA only, required by § 2872 [VERIFY])

## Guidelines

- **Present-tense assignment**: "hereby assigns" vests on creation; "agrees to assign" alone may require a second transfer act
- **DTSA notice**: mandatory post-May 11, 2016; omission bars exemplary damages/fees under 18 U.S.C. § 1833(b)
- **CA non-competes**: void regardless of choice-of-law clause if employee is CA-based; SB 699 / AB 2288 reinforce [VERIFY effective dates]
- **Multi-state**: include carve-outs for all states where employees work; consider jurisdiction addenda
- **Trade secret duration**: statutory protection is indefinite — never cap with fixed term
- **Contractor WMFH**: limited to enumerated 17 U.S.C. § 101 categories; always add backup assignment
- **Post-hire consideration**: IL, WA, MN require independent consideration (raise, bonus, promotion) for restrictive covenants after hire [VERIFY]
- **Verify all [VERIFY] citations** against current codifications before use

## Troubleshooting

- **Missing DTSA notice**: employer loses right to exemplary damages and attorney's fees — add notice and have employee re-acknowledge
- **No state carve-out for employee's jurisdiction**: assignment clause may be unenforceable for personal-time inventions — add applicable statutory language
- **Non-compete in prohibited state**: clause is void and may expose employer to penalties (CA) — remove or convert to non-solicitation
- **No prior invention disclosure**: ambiguity over pre-existing IP ownership — require Exhibit A even if employee checks "none"
- **Contractor treated as employee for WMFH**: misclassification risk — always include backup assignment regardless of relationship type